Apartment Rents Stagnate In LA County

Over the past decade, Los Angeles experienced a significant surge in apartment rent prices. The combination of high demand, limited supply, and various economic factors pushed rents to new heights. However, in recent years, the growth of apartment rents in the city has seemingly come to a halt. While this might come as a surprise to some, several factors have contributed to this. Renters in Los Angeles are still paying top dollar and historically rents are still at an all time high. While rents are still technically growing, the growth at which they are, has slowed dramatically. According to Costar Analytics rents are at $2.85 per square foot as of this month, which is up slightly from $2.83 per square foot per month at the end of last year With rising interest rates and inflationary pressures, the slowdown in rent growth has given pause for active apartment investors in LA County. While many investors are sidelined, we are seeing new construction continue to be on the rise in LA County. This may be contributing to an increase in vacancy rates across the county as new units begin to hit the market increasing overall supply. Costar Analytics also estimates that Los Angeles apartments will continue to hold flat through the remainder of the year. All of the above will only keep buyers sidelined as the disparity between seller and buyer pricing expectations continues to persist.